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EComesa Newsletter 201


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The latest e-COMESA Newsletter, Issue No. 201.

1. COMESA Ministers Articulate Agricultural Issues at the AU Agriculture Conference
2. Model Contracts Help Small Firms Clinch Trade Deals
3. Capacity Building Training in Procurement Launched in Ethiopia
4. International Trade Centre
5. Count down to COMESA Customs Union

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EComesa Newsletter 201

  1. 1. newsletter 1 newsletter Issue #201 24th April 2009 Issue #126 - Friday 19 October 2007 COMESA Ministers Articulate Agricultural Issues at the AU Agriculture Conference M Summit in June/July, 2009. inisters of Agriculture of the from 15-16 August, 2009. COMESA region are actively Meanwhile, the Head of Malawi During the meeting, COMESA Senior participating in the ongoing AU Delegation Dr. Daudi Yamba has Agricultural Advisor Dr Cris Muyunda Ministerial Conference taking place confirmed that the Malawi CAADP held sessions with several COMESA over the period 22-24 April, 2009 at Compact has been approved by the Ministers among them Honourable the AU headquarters in Addis Ababa, Malawian Cabinet. This brings to two, Joseph Made Minister of Agriculture Ethiopia. The host Minister, Honourable after Rwanda the number of CAADP from Zimbabwe who reconfirmed that Tafera, Minister of Agriculture and Rural Compacts concluded in the COMESA country’s readiness to host the COMESA Development for the Federal Republic bloc. COMESA is now way ahead of Agriculture Meetings from May 11-15, of Ethiopia opened the meeting calling all Regional Economic Communities 2009 in Harare. on all cooperating partners to support on the continent in concluding CAADP Africa’s development efforts under the compacts. Dr Muyunda also met Honourable Amin CAADP agenda. Abaza Minister of Agriculture from Egypt All going according to plan, COMESA who reiterated his readiness to host Africa’s lead donors attending the should have three compacts by the time the 2nd Joint COMESA Agricultural/ meeting include JICA, The World Bank, of the COMESA Summit in June this Environment Ministers Meeting in Cairo EU, DfiD, FAO, WFP, IFAD and AGRA. year. Others present are AfDB, Global Donor MODEL CONTRACTS HELP Platform, the UN High Level Task Force on Food Security and UNECA. SMALL FIRMS CLINCH Sierra Leone’s Minister of Agriculture, TRADE DEALS Honourable Sessay, gave a moving outline of Africa’s vast water and land resources and stressed that if the B usiness lawyers from around continent focused strongly on the the world and experts at the disciplined planning process under International Trade Centre (ITC) CAADP, there is no doubt, the continent met this week to finalize model contracts will overcome its developmental for trade deals that can be used free obstacles. of charge by small firms in developing countries. Libyan Minister of Agriculture is chairing the AU Ministerial Session on Agriculture The ITC specialists and lawyers from 51 which is on the theme “investing in countries were joined at the session on agriculture for economic growth and 21-22 April by chambers of commerce food security” and tackling the key and other trade support bodies from issues of climate change, livestock Africa, Asia, Europe and Latin America, who development, land policies, food will make the contracts available to their security, agricultural finance and the member firms from June 2009. overall status of CAADP implementation. “Small exporters can benefit from well- The decisions of the Ministers in Addis drafted model contracts, be they from will form the main materials for the developed or developing countries,” said consideration of the AU Heads of State to page 3 Catherine Ashton
  2. 2. Capacity Building Training in Procurement launched in Ethiopia 2 C apacity building and programme efficiency, ownership are central to all fairness programmes promoted by and prudent the Common Market for Eastern and procurement. Southern Africa (COMESA). By extension, the trainees Within the framework of continuing are expected and deepening procurement reforms to train others in COMESA and, as part of the as one of the implementation of the Enhancing mechanisms Procurement Reforms and Capacity being relied Project (EPRCP), COMESA launched the on by the capacity building training of trainers in Government to address capacity and Delegates at the training Addis Ababa, Ethiopia early this week. specialist knowledge gaps within its a result of lack of public accountability procurement administration. and corruption. He observed that prudent The capacity building training which procurement has potential to mitigate involves the training of a core group of EPRCP Project Manager Mr Colas squandering of government revenues and procurement officers drawn from the Ziki who spoke earlier during the promote investment flows and therefore nine regional governments in Ethiopia opening session noted that improving promote economic growth. and two city administrations started on the capacity in the administration of 20th April 2009 at the Ethiopian Civil procurement will help to generate And Dr. Hailemichael Aberra, the Service Collage in Addis Ababa. It will economic benefits by promoting President of the Ethiopian Civil Service run until 30th April 2009. efficiency, competition as well as College informed the participants and expanding market opportunities in the guests that his college has made the Capacity building is one of the region for the private sector. necessary infrastructure and faculty key components of the Enhancing arrangements to begin offering Procurement Reforms and Capacity Mr. Tsegaye Abebe Abera, Director courses in procurement for the benefit Project (EPRCP) which is expected General of Ethiopian Public Procurement of the regional governments and city to support the reform programme Agency expressed gratitude to COMESA administrations in Ethiopia in the near by creating the necessary skills and on behalf of the Government for the future. He congratulated COMESA competence required to manage support it had provided in reforming for taking the lead in developing the new and reformed procurement that country’s procurement system. a comprehensive curriculum on systems. The other components He underscored the importance procurement training which he noted will include national legislative and policy of modernizing and strengthening be relied on to offer procurement training development and integrating ICT in procurement systems by linking on a sustainable basis. procurement by developing a shared procurement and good governance. He procurement web portal to facilitate stated that good governance, which The capacity building training course increased opportunities for market promotes accountability, transparency, will be replicated in all the COMESA access in public tenders by regional rule of law and participation, is central member States to help support and business communities. to creating and sustaining an enabling consolidate the reform gains by environment for development. He noted increasing the number of procurement The capacity building through training further that poor governance can be professionals to help support effective seeks to develop and upscale the particularly damaging to the effective delivery of government programmes. professional competence and skills economic and social development of As a mechanism to ensure capacity of current officers managing public any country by undermining critical building sustainability, it is planned procurement responsibilities in their programs for poverty alleviation in that COMESA will engage with leading respective jurisdictions and promote education and health, for example, as training institutions in the region to help
  3. 3. from page 1 ITC Executive Director Patricia Francis. to those hardest hit, and the European INTERNATIONAL TRADE “but most smaller firms do not have access Commission earlier this month voiced CENTRE to the legal advice they need at the best of the EU pledge to fulfill our aid promises. 3 ITC, which has 45 years of experience times, and even less so amid pressures to Indeed, we have committed to frontload cut costs in the in assisting developing countries and and refocus existing aid commitments current international economic climate.” transition economies to work their way to reach those who need it as soon as out of poverty through trade, is using possible. To meet this challenge, the Geneva-based the initiative as a way to strengthen its What we should also do is continue to ITC set up a network in which leading law network to support SMEs with contractual better equip developing countries, notably firms with trade expertise seconded top issues and share best practices in contract those in Africa, to take full advantage of the specialists at no charge to work together drafting, while working to increase the economic recovery when it comes. That to create models that – with minimal training capacity of national trade support includes making sure that these countries modifications – can be used for contracts institutions. can reap the benefits of trade. The in any part of the globe. The law firms are G20 meeting in London recognised this, also covering their own costs to attend the The new model contracts will be online reaffirming the commitment to developing meeting. this summer on ITC’s web site, as well as countries to reach the Millennium on the web sites of participating law firms Development Goals, and pledging funds to ITC, a joint agency of the United Nations and national trade support institutions in help boost trade. and the World Trade Organization (WTO), developing countries. The full process of provides the service as a contribution elaborating them, and thus bridging the The gains from trade facilitation to Aid for Trade efforts led by WTO, as many legal and cultural traditions that are Simplified, transparent trade procedures well as the UN Millennium Development reflected global trade, has taken only one are a key component of good trade Goals that aim to help to reduce poverty year. policy and vital for economic growth. through trade. Cumbersome, outdated bureaucracies ITC wishes to express its appreciation to and infrastructure stifle trade and “Small firms, the backbone of many the lawyers and law firms from the 51 entrepreneurship, discourage investment economies, are finding themselves strapped countries who have willingly contributed and encourage corruption. by the current economic crisis,” Ms Francis their time and expertise in drafting these Africa is a very good example to have noted. “These contract models are a model contracts. chosen as the focus of this seminar concrete, practical way to secure their because African companies face many of Opinion: trade deals in global markets. They take these problems, and are very often small into account the increasing sophistication and vulnerable. As such, they stand to of international trade transactions, and Introduction benefit greatly from trade facilitation. incorporate internationally-recognized The economic downturn is affecting standards and best practices.” populations across the world. Economic I was in Lusaka, Zambia earlier this month, output is set to fall in 2009, and although for a pledging conference to support ITC already has contracts in several it may rise again in 2010, it is the most the North-South Corridor infrastructure languages online for perishable goods, vulnerable that face the greatest threat. project. The most important message I publishing and joint ventures. At this week’s According to the World Bank, the got from African leaders was the urgent meeting, 10 more model contracts are economic crisis could push a further 90 need for simpler customs rules and easier being discussed and validated. These range million people in developing countries into transit for goods. Africa’s trade potential from simple sale of goods through long- poverty this year. is being stifled by inefficiencies and red term supply and service and brokerage to tape. One example from the Eastern and establishment of joint ventures for many Developing countries are being hit by the Southern African region was that it costs sectors. downturn in trade and finance. Foreign more to move goods from Uganda to the direct investment is falling, as are trade coast than to then ship it on from there to “Equally important is making sure these volumes and prices for their commodities, Europe or the USA. contracts reach small businesses in poor leading to a slowing in growth. All this countries who need them most,” Ms comes on top of fundamental problems Small and medium-sized enterprises are Francis added. “This is why we are working these countries face – they are already particularly vulnerable to these difficulties, with our global network of trade support being badly affected by food and water because for them such costs are a bigger institutions, who can make the contracts shortages, fuel shortages and the effects of proportion of turnover than for larger free to businesses in several languages climate change. firms. A lack of transparency in rules and through their websites.” ITC will also procedures is often enough to dissuade provide training on their use under local The immediate response has to be to from exporting altogether. This is not ITC programmes. continue to provide the necessary aid to page 4
  4. 4. from page 3 MODEL CONTRACTS HELP SMALL FIRMS CLINCH TRADE DEALS exclusively a problem for the developing to address this need through multilateral, of customs legislation and procedures to 4 world. I know this is something that also regional and bilateral initiatives. The improve trade between the EU and Africa, affects European companies, including WTO has a natural role in setting rules but most importantly to facilitate regional those in Italy, as I heard myself when I was on trade facilitation. The EC supports the trade and transit movements within and in Milan last month. It is still the case that development of a more binding rules- between communities in Africa. only 3% of EU SMEs export outside of the based approach, and trade facilitation is a EU. prominent element in the Doha Round of We also provide help to African companies The benefits from streamlining are world trade talks. It is therefore hardly a to understand our European import significant. Studies show that globally, the surprise that African countries have called procedures, rules and standards through costs of trade procedures may range from for strong new rules on trade facilitation our Export Helpdesk. Anchored by a 2% to 15% of the value of traded goods. in the WTO, because they see the benefits useful and popular website, this gives If we could halve these costs, we could to their continent. It explains why African information on preferential import tariffs, achieve savings in the hundreds of billions business has joined European business in customs documents, rules of origin and of euros every year. calling for an ambitious Doha agreement. trade statistics. Our own estimate is that the trade Regarding delays of shipments at border facilitation agreement in WTO will bring All of this must be backed up with a crossings, the precise cost to business is trade gains equal to those of industrial serious financial commitment, and the EU unquantifiable, but clearly this is a barrier tariff cuts and services combined. is by far the largest contributor to Aid to trade. Countries that have introduced for Trade initiatives, with commitments trade facilitation measures have reduced In parallel to the WTO work, the EC is also of more than EUR 7 billion per year. border crossing times massively. The pursuing trade facilitation in regional and The largest share of that – EUR 2.7 Philippines has reduced times from up to bilateral initiatives, including with the USA, billion - goes to Africa. Under the 10th 8 days down to 4 hours; Bangladesh from South Africa, China, Asean, Mercosur and European Development Fund (EDF), the up to 3 days to 3 hours; Costa Rica from ACP countries. Where appropriate, these European Commission has almost doubled up to 6 days to as little as 12 minutes. initiatives incorporate technical assistance the financial commitment for regional This is often the difference between doing initiatives. integration of ACP countries (compared to business and not doing business. the previous period of 2000-2007). For governments, simplified customs Trade facilitation in Africa procedures also save money while In Africa multiple and overlapping regional Some examples in Africa – we have improving levels of control. Chile spent economic initiatives and groupings have led allocated EUR 645 million to support the US$5 million on automation of customs, to a multiplication of rules and the creation regional integration of the Eastern and but recouped the investment in just over of major obstacles to intra-regional trade Southern Africa and Indian Ocean region, a year. as well as international trade. and EUR 116 million for the Southern African countries are taking steps to Africa Development Community (SADC). Time for action deal with this. We hope to contribute I mentioned the North-South Corridor Business is telling us that trade facilitation to improving the situation through the – here the Commission has pledged EUR needs to be put squarely on the political Economic Partnership Agreements (EPAs) 115 million to improve trade linkages in top table. There is a need for simpler that we are working on with African the Southern and Eastern African region. trade procedures so as to reduce delays, partners, as well as with the Caribbean and cut costs, improve the services offered to Pacific. With EPAs, the EU aims amongst Conclusion consumers, and even get into overseas other things to reinforce cooperation in Trade facilitation, like trade finance, is vital markets in the first place. the area of customs and trade facilitation. if our global trading system is to work. We The European Commission is working Our aim is to promote harmonisation preach the benefits of free and fair trade for development and growth, but how can developing countries prosper if trade often Count down to COMESA Customs Union falls at the first hurdle? Spending on major infrastructure projects in Africa is vital, but it must go hand in hand with reform of administration and We are only 44 days to the Launch of the regulation. For example, improving port administration can have same effect as COMESA Customs Union building a whole new port, at a fraction of the cost and in much less time. This realisation is the real key to unlocking